Management: Chapter 6 - Managing Responsibly and Ethically - PDF

Management Thirteenth Canadian Edition Chapter 6 Managing Responsibly and Ethically Copyright © 2022 Pearson Canada Inc....

Management Thirteenth Canadian Edition Chapter 6 Managing Responsibly and Ethically Copyright © 2022 Pearson Canada Inc. 6-1 Learning Outcomes 1. Discuss what it means to be socially responsible and what factors influence that decision. 2. Describe how managing responsibly contributes to organizational performance. 3. Discuss the factors that lead to ethical and unethical behaviour. 4. Describe management’s role in encouraging ethical behaviour. Copyright © 2022 Pearson Canada Inc. 6-2 Encouraging Ethical Behaviour Managers can encourage ethical behavior Hire individuals with high ethical standards. Establish codes of ethics and decision rules. Simply writing down codes of ethics and values would not make a company ethical unless they actually start implementing those mentioned ethical standards. Lead by example. Delineate job goals and performance appraisal mechanisms. Copyright © 2022 Pearson Canada Inc. 6 - 22 Encouraging Ethical Behaviour Employee Selection: Selection process: behavioral interviews, scenario-based interviews, personality tests, background checks, and so forth—could be used to eliminate ethically questionable applicants. Values-based management: is an approach to managing in which managers establish and uphold an organization’s shared values. Ex- encourage employee volunteering Copyright © 2022 Pearson Canada Inc. 6 - 23 Encouraging Ethical Behaviour Code of Ethics: A formal statement of an organization’s primary values and the ethical rules it expects its employees to follow. Ex- After the Nike scandal of using child labour, they laid out a code of ethics that covered even its suppliers Copyright © 2022 Pearson Canada Inc. 6 - 24 Exhibit 6.9 Codes of Ethics Cluster 1. Be a Dependable Organizational Citizen 1. Comply with safety, health, and security regulations. 2. Demonstrate courtesy, respect, honesty, and fairness. 3. Illegal drugs and alcohol at work are prohibited. 4. Manage personal finances well. 5. Exhibit good attendance and punctuality. 6. Follow directives of supervisors. 7. Do not use abusive language. 8. Dress in business attire. 9. Firearms at work are prohibited. Copyright © 2022 Pearson Canada Inc. 6 - 25 Exhibit 6.9 Codes of Ethics Cluster 2. Do Not Do Anything Unlawful or Improper That Will Harm the Organization 1. Conduct business in compliance with all laws. 2. Payments for unlawful purposes are prohibited. 3. Bribes are prohibited. 4. Avoid outside activities that impair duties. 5. Maintain confidentiality of records. 6. Comply with all antitrust and trade regulations. 7. Comply with all accounting rules and controls. 8. Do not use company property for personal benefit. 9. Employees are personally accountable for company funds. 10. Do not propagate false or misleading information. 11. Make decisions without regard for personal gain. Copyright © 2022 Pearson Canada Inc. 6 - 26 Exhibit 6.9 Codes of Ethics Cluster 3. Be Good to Customers 1. Convey true claims in product advertisements. 2. Perform assigned duties to the best of your ability. 3. Provide products and services of the highest quality. Source: From “An Empirical Study of Codes of Business Ethics: A Strategic Perspective,” by F.R. David, paper presented at the 48th Annual Academy of Management Conference, Anaheim, California, August 1988. Copyright © 1988 Fred David. Copyright © 2022 Pearson Canada Inc. 6 - 27 Encouraging Ethical Behaviour Ethical Leadership: Doing business ethically requires a commitment from top managers. It’s the top managers who uphold the shared values and set the cultural tone. They are role models in terms of both words and actions, although what they do is far more important than what they say. Ex- at Enron, ethical leadership was lacking, top managers advocated for manipulating accounting records. Copyright © 2022 Pearson Canada Inc. 6 - 28 Encouraging Ethical Behaviour Job Goals and Performance: Under the stress of unrealistic job goals, otherwise ethical employees may feel they have no choice but to do whatever is necessary to meet those goals. To encourage ethical behaviour, both ends and means should be evaluated. Ex- Achieving sales targets by construction company sales reps> bribing purchasing officers Achievement pressure at Volkswagen> emissions rigging Copyright © 2022 Pearson Canada Inc. 6 - 29 Encouraging Ethical Behaviour Ethics Training Training can make a difference in ethical behaviours. Training increases employee awareness of ethical issues in business decisions. Training clarifies and reinforces the standards of conduct. Employees are more confident of support when taking unpopular but ethically correct stances. Copyright © 2022 Pearson Canada Inc. 6 - 30 Encouraging Ethical Behaviour Independent Social Audits The fear of being caught can be an important deterrent to unethical behaviour. Independent social audits, which evaluate decisions and management practices in terms of the organization’s code of ethics, increase that likelihood. Fair labour association monitoring Apple labour practices. https://youtu.be/cahyw-4Kcqk Copyright © 2022 Pearson Canada Inc. 6 - 31 Encouraging Ethical Behaviour Formal Protective Mechanisms Provide formal mechanisms to protect employees who face ethical dilemmas so that they can do what is right without fear of reprimand. Whistle-blowers: individuals who raise ethical concerns or issues to others inside or outside the organization. Ethics hotlines. https://youtu.be/xuiDuoRJkOY Copyright © 2022 Pearson Canada Inc. 6 - 32